What is in this article?:
- Farm bill fate unlikely in 2012
- Crop insurance's role
- The fate of U.S. agriculture rides as much on the public statements and legislative acts of federal lawmakers as it does on the ebbs and flows of global markets.
- The federal deficit and the looming 2012 elections will shape — or, as the case may be, impede — passage of the next farm bill.
The fate of U.S. farming rides as much on the public statements and legislative acts of federal lawmakers as it does on the ebbs and flows of global markets.
No one knows that better than Jim Novak, an Alabama Cooperative Extension System agricultural economist, who has spent his career monitoring and interpreting all of these trends and who is now busily engaged divining the shape of the next farm bill.
For now, the two factors that will shape — or, as the case may be, impede — passage of the next farm bill are the yawning federal deficit and the looming 2012 elections, says Novak. Largely for these reasons, he says passage is far more likely in 2013.
One thing is virtually certain, he says, is a farm bill that is less generous than the current one.
The Budget Control Act passed last year stipulates that any increase in the debt limit has to be accompanied by corresponding budgetary cuts. While farm programs occupy a comparatively small share of overall federal appropriations, Novak says they are no less likely to escape the budgetary ax.
One program most susceptible to axing or, at minimum, downsizing: direct payments, which, according to some farm policy observers, may be cut by as much as 60 percent or eliminated entirely.
“It’s highly possible that direct payments will be ended, but that’s not 100 percent certain,” says Novak, who speculated about the upcoming farm bill at the 2012 Wiregrass Cotton Expo, held in Dothan, Ala.
Likewise, counter-cyclical payments and the Average Crop Revenue Election program, commonly known by its acronym ACRE, may eliminated as well, although Novak says it’s more likely that some form of counter-cyclical payments will be retained along with the inclusion of a revenue program.